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Beware the Pitfalls of Missed HO Exposures
Bulletin – Tuesday, September 16, 2008
The number 1 cause of E&O claims in personal lines is a failure to provide the proper coverage. Many agents assume that a client's exposures are typical or will be revealed in the application process but that is not always the case. According to Curtis Pearsall, President of Utica National Insurance Group, “Two exposures really caught my eye that has the potential to cause problems now and down the road: home-based businesses and collectibles."
More people are working from home today than ever before and that includes almost five million home-based businesses. A study by the Department of Labor revealed that most of these home-based business owners felt their homeowner’s coverage would adequately protect their business. However, the homeowner’s policy usually limits coverage for business-use property to around $2500. In addition to the property exposure, these clients may face an even greater potential for loss in the general liability and professional liability lines. Just because a business is operated from a home, does not mean exposures are any different than a business run from a Main Street location.
Did you know there are over 2500 collectible clubs nationwide? These clubs range from Barbies to baseball cards and salt and pepper shakers. To a collector, nothing is more ‘real’ in value than the items they lovingly collect and preserve. In situations like these, it is imperative for insurance professionals to identify and address the insurance exposure, coverage, and limitations for the typical homeowner.
More people are working from home today than ever before and that includes almost five million home-based businesses. A study by the Department of Labor revealed that most of these home-based business owners felt their homeowner’s coverage would adequately protect their business. However, the homeowner’s policy usually limits coverage for business-use property to around $2500. In addition to the property exposure, these clients may face an even greater potential for loss in the general liability and professional liability lines. Just because a business is operated from a home, does not mean exposures are any different than a business run from a Main Street location.
Did you know there are over 2500 collectible clubs nationwide? These clubs range from Barbies to baseball cards and salt and pepper shakers. To a collector, nothing is more ‘real’ in value than the items they lovingly collect and preserve. In situations like these, it is imperative for insurance professionals to identify and address the insurance exposure, coverage, and limitations for the typical homeowner.